Samsung Electronics secured a manufacturing agreement with Apple to produce chips at its Austin, Texas facility using what the companies describe as an innovative technology never deployed commercially before. The partnership represents a notable shift for Apple, which has historically relied heavily on Taiwan Semiconductor Manufacturing Co. and Sony for critical components.
Industry sources suggest the chips will likely serve as image sensors for future iPhones and other Apple devices, according to Business Korea. The deal comes as Samsung’s foundry operations face mounting pressure to reduce losses and compete more effectively against TSMC’s dominance in advanced chip manufacturing.
Analysts see significance in Samsung taking over some image sensor volumes that Apple previously sourced from Sony, representing Apple’s broader supply chain diversification strategy. The arrangement aligns with Apple’s $600 billion domestic investment commitment over four years, though specific financial terms remain undisclosed.
Samsung’s Austin facility represents the established arm of its Texas operations, distinct from the company’s troubled $17 billion Taylor plant that has faced repeated delays and customer acquisition challenges. The South Korean conglomerate received $6.4 billion in CHIPS Act funding to support its broader Texas expansion, though questions persist about execution capabilities given recent setbacks in bringing advanced manufacturing online.
The partnership underscores both companies’ attempts to reduce dependence on Asian supply chains while navigating their smartphone market rivalry.
